Menu Items in MBC

Question

Hi,

I am considering to design an MBC to test a product that has 35 features/menu items (to be shown on one screen) from which the customer can chose to create his customized offering. Each feature will be tested across 5 price levels.

We wanted to ensure if it is possible to create an MBC design with all the 35 features as menu items?
Will there be any complexity due to the large number of menu items during utility estimation?
Is there any thumb rule which tells us how many min and max menu items can be tested?

Looking forward to your response.

Thank you

Answer 1

Surabhi,

35 is getting pretty big, though the only real limit on an MBC is what you can show on the screen.  Usually with MBC you're building a separate binary logit model for each of your features, so having 35 instead of 10 just means 35 models instead of 10 models.

I assume you'll have 5 price levels and an option not to pick that feature at all?

Much beyond 35 items you have to start to worry that almost no one chooses an item - if that happens you get some pretty noisy utilities (with large standard errors) for the really infrequently chosen items.